Hayduk v. Pidoborozny, [1972] SCR 879

Supreme Court of Canada

Hayduk v. Pidoborozny, [1972] S.C.R. 879

Date: 1972-05-01

Mike Hayduk, a person of unsound mind, by his next friend, Walter Hayduk, and Alexandra Boyko, an infant, by her next friend, Peter Boyko (Plaintiffs) Appellants;

and

Ronald W. Pidoborozny and Peter Pidoborozny (Defendants) Respondents.

1972: January 27; 1972: May 1.

Present: Abbott, Martland, Ritchie, Pigeon and Laskin JJ.

ON APPEAL FROM THE SUPREME COURT OF ALBERTA, APPELLATE DIVISION

Motor vehicles—Vicarious liability of owner—Father purchasing motor vehicle—Registered as owner—Son having exclusive use—Included within statutory meaning of “owner”—Father not excluded from status as an owner—The Vehicles and Highway Traffic Act, R.S.A. 1955, c. 356, ss. 2(m), 130 [a.m. 1963, 72, s. 39].

In an action for damages for injuries suffered by the appellants as a result of a motor vehicle accident, the respondents were found to be jointly and severally liable. The appellants were being driven by the first respondent in a motor vehicle of which his father, the second respondent, was the registered owner under The Vehicles and Highway Traffic Act, R.S.A. 1955, c. 356. The motor vehicle had been purchased by the father under a conditional sales agreement in his own name and the son then took possession of it with his father’s consent. The payments due were made by the son and the evidence was that the father had become the purchaser for the purpose of guaranteeing payment of the purchase price. The son had the exclusive use of the vehicle for more than 30 days prior to the accident.

The trial judgment was reversed by the Appellate Division of the Supreme Court of Alberta and an appeal was then brought to this Court. The finding of the trial judge that the driver was grossly negligent in the operation of the motor vehicle at the time of the accident was not questioned and the main issue was whether the fact of his being the registered owner was of itself enough to make the father vicariously liable under the provisions of the Act.

Held: The appeal should be allowed and the judgment at trial restored.

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Under the Act, proof of registration was to be treated as proof of ownership unless and until the contrary was shown. In the present case, however, the contention that the father was the owner within the meaning of s. 130 did not rest upon registration alone. A valid sale of the motor vehicle had been made to him and he was the owner at common law notwithstanding the fact that his son had made the payments under the conditional sales contract and had had exclusive possession of the vehicle from the date of its purchase.

It could not be denied that by virtue of s. 2(m) the son was an “owner” for the purpose of the Act, but by including any person who has had exclusive use of a motor vehicle for more than 30 days within the statutory meaning of the word “owner” the Legislature did not intend to exclude nor did it effectively exclude the registered owner from his status as an owner or relieve him from the liability which that status involved under the provisions of s. 130.

Chuwick v. Bevans et al. (1964), 49 W.W.R. 699; Furjes v. Goodman et al. (1956), 19 W.W.R. 26; Yaeger v. Heilman, [1948] 2 W.W.R. 135 [affirmed [1948] 2 W.W.R. 958], followed.

APPEAL from a judgment of the Supreme Court of Alberta, Appellate Division[1], reversing a judgment of Greschuk J. Appeal allowed and judgment at trial restored.

L.L. Decore, for the plaintiffs, appellants.

E.M. Woolliams, Q.C., for the defendants, respondents.

The judgment of Abbott, Martland, Ritchie and Pigeon JJ. was delivered by

RITCHIE J.—This is an appeal from a judgment of the Appellate Division of the Supreme Court of Alberta reversing the judgment renddered at trial by Greschuk J., whereby he found that the respondents, who are father and son, were jointly and severally liable for damages sustained by the appellants when they were being driven in a motor vehicle operated by Ronald Pidoborozny of which his father, Peter Pidoborozny, was the registered owner under The Vehicles and Highway Traffic Act, R.S.A. 1955, c. 356 (hereinafter referred to as the Act).

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The finding of the learned trial judge that the driver was grossly negligent in the operation of the motor vehicle at the time of the accident is not questioned in this appeal in which the main issue is whether the fact of his being the registered owner is of itself enough to make the father vicariously liable under the provisions of the Act. This is made apparent by the submissions contained in the factums filed on behalf of both parties.

The second paragraph of the appellants’ factum reads as follows:

The Appellate Division held (reversing the court below that the father who registered a motor vehicle in his own name was not an owner of the motor vehicle within the meaning of Sections 2(M) and 130 of The Vehicles and Highway Traffic Act. This is an appeal from that decision.

and in Part II of the factum of the respondent the matter is bluntly stated as follows:

It is submitted that there is one issue, namely whether a registered owner is an owner within the meaning of Section 130, the vicarious liability section of The Vehicles and Highway Traffic Act of Alberta.

Section 130 provides as follows:

In an action for the recovery of loss or damage sustained by a person by reason of a motor vehicle upon a highway, a person driving the motor vehicle and living with and as a member of the family of the owner thereof and a person who is driving the motor vehicle and who is in possession of it with the consent, express or implied, of the owner thereof shall be deemed to be the agent or servant of the owner of the motor vehicle and to be employed as such, and shall be deemed to be driving the motor vehicle in the course of his employment, but nothing in this section relieves any person deemed to be the agent or servant of the owner and to be driving the motor vehicle in the course of his employment from the liability for the damages.

The facts concerning the ownership of the car are set out in the judgment of the learned trial judge and reiterated in the reasons for

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judgment delivered on behalf of the Appellate Division by McDermid J.A., and are as follows:

The defendant-driver was 19 years of age on the day of the accident. On October 8, 1966, he made an offer to Zarowny Motors Ltd. an automobile dealer firm in St. Paul, to purchase a 1962 8-cylinder Dodge sedan vehicle for the sum of $1,125, as shown in ex. 9, but this offer apparently was not accepted. On the same day, the defendant-owner purchased the same vehicle from the same dealer, under and by virtue of a conditional sales agreement at and for the sum of $1,364, which included finance charges of $139, by paying the sum of $500 on account of the purchase price and executing a promissory note for $864 payable in 15 consecutive monthly instalments of $57.60 each. Shortly thereafter he became the registered owner of this vehicle in the Motor Vehicles Branch of the Department of Highways and Transport for the Province and remained the registered owner at all material times. Although all of the payments due and owing under the promissory note and the conditional sales contract were made by the defendant‑driver, one request for an unpaid instalment, as shown in ex. 8, was sent to the defendant-owner. At the time of the purchase of the vehicle the defendant-driver was a surveyor and resided in Westlock, Alberta. He had the exclusive use of the vehicle from October 8, 1966, to and including the date of the accident.

* * *

I now turn to the first issue which I must determine, which is whether or not on the day of the accident, the defendant, Peter Pidoborozny, was the owner of the motor vehicle driven by his co-defendant. It is unnecessary for me to repeat the facts in respect to the purchase of the vehicle in question by the defendant, Peter Pidoborozny, and, the manner in which he became the registered owner pursuant to the provisions of the Vehicles and Highway Traffic Act, R.S.A. 1955, c. 356, and amendments thereto. It is admitted that the defendant-driver took possession of the motor vehicle from his father with the latter’s express consent, had exclusive possession and control at all material times and made all of the payments due and owing under the conditional sales contract and the promissory note. Both defendants testified that they had arranged between themselves that the payments would be made by the defendant-driver, and, that the father became the purchaser of the vehicle for the purpose of guaranteeing payment of the purchase price, so that, if the defendant-driver refused or

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failed to pay any instalment due under the conditional sales contract or promissory note the father would be liable for the same.

I think it well also to reproduce those parts of the cross-examination of the appellants dealing with the ownership of the car which are referred to by the Appellate Division. The father’s evidence in this regard was:

Q. In other words then, Mr. Pidoborozny, your son Ronnie had exclusive use of the car from October, 1966 until the date of the accident, June 18th, 1967, is that correct?

A. Yes.

* * *

Q. That is to say he had exclusive use of this car well over 30 days for that whole period of time from October, 1966 until June of 1967, is that correct?

A. Yeah, I think so.

Q. …By the way, when you took registered ownership of the vehicle you did so because if in the event that Ronnie couldn’t pay for the financing of it you would have to, is that correct?

A. Yes, that’s right.

The son’s evidence on the same subject was:

Q. Mr. Pidoborozny, from the time you purchased the car in October of 1966 until the date of the accident on June 18th, 1967 you had exclusive use of that vehicle, is that correct?

A. Yes.

Q. In fact, you were not even living with your parents for that period of time from when you bought the car until the date of the accident, is that correct?

A. Yes.

Q. And the reason that your father was registered as owner of the vehicle was that in the event that you could not pay for it your dad would have to, is that correct?

A. Yes.

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If the father is found to have been an “owner” of the car within the meaning of the Act, I have no doubt that at the time of the accident the son was in possession of it with his father’s consent and that by virtue of the provisions of s. 130, he would be deemed to have been driving the car in the course of his employment as a servant or agent of the father so as to make the latter vicariously liable for the damage which ensued.

There have been conflicting decisions in the Trial Division of the Supreme Court of Alberta as to the meaning to be given to the word “owner” as it occurs in s. 130, and the Courts of other provinces have not been uniform in interpreting similar sections in their respective highway traffic acts; but before considering these authorities I think it desirable to examine the internal evidence within the Act itself which indicates the intention of the Legislature. In this regard, I proceed on the assumption that the word “owner” has the same meaning wherever it occurs in the Act. It would take the strongest kind of statutory language to satisfy me that the Legislature was attributing one meaning to the word “owner”, for example in the financial responsibility sections of the Act, and another in the section dealing with vicarious liability.

As has been pointed out by the Appellate Division, s. 127(1) of the Act is relevant to this issue and I refer particularly to the following portions of that section:

When proof of ownership of any motor vehicle… is required, the production of a certificate purporting to be under the hand of the registrar or his deputy, to the effect that the person named therein is or was the registered owner of the vehicle… is prima facie proof thereof, without proof of signature or official character.

I think it to be a significant indication of the importance and effect that the Legislature intended to give to registration of ownership of a motor vehicle that proof of such registration is, by the clear terms of this section of the statute, to be treated as proof of ownership unless and until the contrary be shown.

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Further light is in my view thrown on the intention of the Legislature by the sections of the Act dealing with financial responsibility of owners and drivers. In this regard the following sections appear to me to be particularly apposite:

156. Proof of financial responsibility shall be given by every driver, and in the case of an owner, by every owner to whom this Part applies for each motor vehicle registered in his name, in the amounts Stated in subsection (1a) of section 150, and subject to the limitations, conditions and qualifications prescribed for an owner’s and a driver’s policy respectively by Part VII of the Alberta Insurance Act.

159. (1) If the Minister finds that any driver to whom this Part applies was at the time of the offence for which he was convicted employed by the owner of the motor vehicle involved therein as chauffeur or motor vehicle operator, whether or not so designated, or is a member of the family or household of the owner, and that there was no motor vehicle registered in the Province in the name of such driver as an owner, then if the owner of the motor vehicle submits to the Minister, who is hereby authorized to accept it, proof of his financial responsibility as provided by this Part, the chauffeur, operator, or other person shall be relieved of the requirement of giving proof of financial responsibility on his own behalf.

The italics are my own.

It seems clear to me that the terms of the last-quoted section point to the registered owner as the “owner” for the purpose of furnishing proof of financial responsibility.

There is a logical reason why the registered owner should be treated as “owner” within the meaning of the Act because the very purpose of the registration is to give notice to all users of the highway of the identity of an individual to whom they may look as owner in the event of an accident. In the present case, however, the contention that the father was the owner within the meaning of s. 130 does not rest upon registration alone. Here the father was the purchaser of the motor vehicle in conformity with the terms of a conditional sales contract which he

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had signed and the son had not. It is true that the son made all payments under this contract from his own resources, but the contract was obtained on the credit of the father and the payments thereunder were not fully discharged until after the accident had occurred. With all respect to the members of the Appellate Division, I agree with the learned trial judge that a valid sale of this motor vehicle had been made to the defendant Peter Pidoborozny (the father) and that he was the owner at common law notwithstanding the fact that his son had made the payments under the conditional sales contract and had had exclusive possession of the vehicle from the date of its purchase.

There can be no dispute about the fact that the son had the exclusive use of the motor vehicle for a period of more than thirty days and this brings into play the extended meaning attached to the word “owner” by s. 2(m) which reads as follows:

In this Act

(m) “owner” includes any person renting a motor vehicle or having the exclusive use thereof, under a lease or otherwise, for a period of more than thirty days.

It cannot be denied that by virtue of this section the son was an “owner” for the purpose of the Act, but I do not think that by including any person who has had exclusive use of a motor vehicle for more than thirty days within the statutory meaning of the word “owner” the Legislature intended to exclude or did effectively exclude the registered owner from his status as an owner or relieve him from the liability which that status involves under the provisions of s. 130.

Like the learned trial judge, I would follow the cases of Chuwick v. Bevans et al.[2], Furjes v. Goodman et al.[3] (Alta.) and Yaeger v. Heilman[4], in so far as they recognized that there may be more than one owner under the provisions of the Act.

The respondents cited and relied upon a number of decisions of the Court of Appeal of

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Ontario in this regard and I think it sufficient to say that these cases were decided under The Highway Traffic Act of Ontario and in my opinion are of no assistance in interpreting the Alberta Vehicles and Highway Traffic Act, supra. In my opinion, under the Alberta statute the registered owner remains an “owner” notwithstanding the fact than an extended meaning has been given to the word by s. 2(m) so that a person who has the exclusive use of the motor vehicle for a period of more than thirty days before the collision is also included as an “owner”.

Applying the above reasoning to the facts of this case, I would allow this appeal and restore the judgment of the learned trial judge and direct that the appellants do recover from the respondents jointly and severally the amount of damages and costs as assessed at trial.

The appellants will have their costs in this Court and in the Appellate Division of the Supreme Court of Alberta.

LASKIN J.—I agree that this appeal should succeed in the terms proposed by my brother Ritchie. The issue in appeal, although arising under Alberta legislation, is of Canada-wide concern under similar if not exact legislation in other provinces. The authorities marshalled by counsel on each side make this quite clear.

If any one case can be said to underlie the principle upon which the Alberta Appellate Division in the present case and other provincial Courts have proceeded, it is Wynne v. Dalby[5]. There the issue was not whether the registered owner was liable—indeed, he was also the negligent driver—but whether the conditional seller could be held liable as “owner” as well as the conditional buyer, in addition to the negligent driver. In refusing to hold the conditional seller as “owner”, the Ontario Court of Appeal applied a “dominion” test; and this formula permeated succeeding case law where the issue was the different one of whether a person who was registered as owner could escape statutory vicarious

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liability by proof that the legal or beneficial interest was in another.

Haberl v. Richardson[6], in the Ontario Court of Appeal was such a case, and, on its facts, similar to the present one. Wynne v. Dalby was applied by that Court in reversing the judgment of my brother Spence, then a member of the Trial Division of the Supreme Court of Ontario, He held the registered owner liable, that person being also the conditional purchaser under a contract that was still on foot at the time of the accident. In my opinion, the judgment of Spence J. reflected the proper approach for the application of the vicarious liability provisions of the provincial Highway Traffic Act.

The issue of ownership, where it arises under a claim of statutory vicarious liability of a car owner to an injured third person, is not one to be decided as if it arose in litigation between the father and son, the defendants in the present case. The applicable statute, The Vehicles and Highway Traffic Act, R.S.A. 1955, c. 356, as amended, cannot be so construed when regard is had to its provisions for public registration of car ownership and, concurrently, for proof of financial responsibility.

Appeal allowed and judgment at trial restored, with costs.

Solicitors for the plaintiffs, appellants: Decore, Decore & Decore, Edmonton.

Solicitors for the defendants, respondents: Cavanagh, Henning, Buchanan, Kerr & Witten, Edmonton.